Australian Finance Group has recorded close to $22 billion in lodgements in the third quarter of the 2022 financial year and a 6.9% increase in home loan lodgements compared to the same period last year, as non-major lenders close the gap on the majors to now be at 49% of the market.
“The traditionally quieter new year period was marked by strong customer demand with homebuyers navigating the end of ‘cheap money’ as the big banks’ Term Funding Facility came to an end,” AFG CEO David Bailey said. “As a result, fixed rate volumes have plummeted. The record low interest rate environment is over, and as lenders evaluate their future funding costs, they have been increasing fixed rates. The percentage of people choosing to fix their home loan has dropped from highs of 38.2% in Q1 22 to now be down to 20%. This is the lowest it has been in two years.”
Bailey said the activity saw the market share of NZ’s major lenders and their associated brands decline from 53.5% last quarter to 50.8% by the end of March 2022 – the lowest level recorded in our time series.
“Among the majors, ANZ was the only lender to make up ground, lifting from 7.87% last quarter to 8.72% at the end of the Q3 22,” he said. “NAB took the biggest hit, dropping 2.63% from 11.83% in Q2 to 9.2% for the past quarter. For the non-majors, Macquarie made the most gains compared to the same period last year, increasing from 9.91% to 11.28%, AFG Home Loans grew to 10.19%, up from 9.11% a year ago, and Suncorp came in at 3.67% for the quarter, up from 2.63% in Q3 21.”
Bailey said the average loan size is down by $8,409 on last quarter to $615,668, while LVR has dipped to 66.8%. First-home buyers, meanwhile, fell by 5% from the same period last year.
“Investor loans maintained their level from the prior quarter, at 26%,” Bailey said. “This is an increase of 3% on the same period last year. Interest-only products have been steady at 17% for the past three quarters. Refinancers have dropped slightly to 24%, whilst upgraders were once again the drivers of most of the activity at 44% of lodgements. Pleasingly, lender turnaround times are once again steady at 21.9 days from application to formal approval.”
Bailey said the easing in volumes has allowed lenders to recruit and train extra staff and work on their systems and processes.
“With more than 70 lenders on AFG’s panel, the opportunity for brokers to find the right lending solution for their customers is assured,” he said. “As we head into a rising interest rate environment, the competitive tension provided by the broker channel will ensure that homebuyers are always able to choose the lending solution that is the right fit for their individual circumstances.”
